5G is LIke 3G, 4G, in Two Ways; Different in One

In two ways, 5G is like 3G and 4G.

The hope for 3G was “new applications.” The hope for 4G? “New applications.” So 5G is not unusual in that regard.

This time around, though, it is applications related to sensor networks that drive hopes. That explains why it is impossible to discuss 5G without reference to internet of things. Services built around connected car or connected healthcare provide examples of that thinking.

“Non-healthcare players, including app developers and telcos, already generate 13 percent and 9 percent of their respective total revenues from healthcare,” says Ericsson. “Cross-industry experts say that by 2020 it is expected to reach 19 percent and 13 percent respectively.”

The other new element is that, although 5G will include faster-speed internet access that rivals fixed network speeds, most of the new IoT apps will only require narrowband connections. That “high and low” element (compared to 4G) illustrates the way 4G and 5G are likely to coexist.

Where 5G will shine is extremely-high bandwidth apps for human users, and very low bandwidth for IoT (non-human users). That means 4G will exist in the middle, and mostly used by humans.

Access services still will be important. But the big upside is in the application and platform part of the ecosystems. You can only do dumb pipe so long, or so well.

Of course, there is one way in which 5G represents continuity. And that is the second commonality between 3G, 4G and 5G.

Both 3G and 4G made possible new offers based on "higher speed access." And 5G will not disappoint on that score. So one way 5G will enable "new sources of revenue" comes from the simple ability to sell mobile internet access and fixed network access, at prices likely comparable to what fixed network packages have offered.

The "new app" in that sense remains "faster speed."

That is the promise and peril of 5G. Optimists argue the huge upsurge in new connections, plus chances to move across the value chain and up the stack explain the strategic importance of 5G.

Pessimists will note that success is uncertain, as it is hard to clearly delineate how “moving up the stack” will happen.

But all might agree that "faster speeds" are one way new value has been created by each succeeding generation of mobile platforms. So irrespective of opportunities elsewhere in the IoT ecosystem, 5G will enable a replacement service for 4G mobile internet access.